Subprime lending

Nine banks and lenders were impacted by the yearslong, $923 million fraud enterprise, according to an indictment of top Tricolor executives. The banks were not publicly named, but JPMorganChase, Fifth Third, Barclays, Louisiana-based Origin Bancorp and Texas-based Triumph Financial have said they would take write-downs.

A survey compiled by the American Financial Services Association showed deteriorating business conditions during the third quarter of this year. The outlook for subprime borrowers was particularly grim.

The Consumer Financial Protection Bureau is considering a proposal to reduce its oversight of auto finance lenders, saying the benefits of supervision may not justify the "increased compliance burdens."

Triumph Financial took steps to guard and move scores of cars backing its $23 million loan to Tricolor Holdings after the subprime auto lender filed for bankruptcy last week.

Origin Bancorp, Renasant Bank and Triumph Financial are the latest financial institutions to report exposure to the bankrupt auto lender Tricolor, joining a list that includes Fifth Third, Barclays and JPMorganChase.

Tricolor Holdings had been showing some cracks leading up to its bankruptcy filing Wednesday. Fifth Third, which had funded the company, said that the problem is a "one-off."

Fintech lenders often get criticized for high rates or fees on their consumer lending. But there's an argument to be made that the alternatives are worse.

The subprime lender OppFi sued California's consumer protection agency last year, arguing its loans are not subject to the state's interest rate cap of 36%. State officials are asking a judge for an injunction on new loans until the broader fight is resolved.

A lawsuit filed by Attorney General Maura Healey last year said Credit Acceptance Corp. in Michigan made predatory loans to Bay State borrowers and used deceptive practices to collect debt.

The Chicago subprime lender had previously warned that regulators were investigating its military lending practices. Its stock price rose by about 9% after the disclosure that the probe has wrapped up.

Subprime borrowers whose credit scores have risen since they bought their cars are increasingly looking for a better deal. Credit unions and small banks are seizing the opportunity, often with the help of fintechs.

The Spanish bank’s U.S. holding company said it will pay a premium to purchase the publicly traded shares in Santander Consumer Holdings. The proposal is subject to the approval of the auto lender’s board of directors.

KMD Partners, which makes high-interest rate loans through its CreditNinja brand, has agreed to acquire the $11.7 million-asset Liberty Bank. The purchase is likely to draw scrutiny, but the companies argue that it will help borrowers with lower credit scores qualify for less expensive loans.

After more than 100 years of mostly in-person operations, the subprime installment lender is seeking to adapt to changing consumer preferences — launching an online loan platform just before the pandemic and recently striking a deal to acquire a financial wellness app.

Looming defaults and the potential for heavier regulatory scrutiny have prompted banks to pull back from the sector. Is that a good thing?

The San Francisco company has faced financing challenges as its customers, largely lower-income Latinos, have struggled to keep up with monthly payments.

The company, which provides credit cards to millennials, is expanding its target audience beyond thin-file consumers and those without credit histories. It will now also target those with blemished, nonprime credit histories.

Millennial credit card provider Petal is expanding its target audience beyond thin-file consumers and those without credit histories. It will now also target those with blemished, non-prime credit histories.

A borrower advocacy group is asking federal banking regulators to investigate PayPal and Synchrony Financial, which partner on a product that is used to offer high-cost education financing.

Covered Care is promising to offer affordable loans to borrowers with credit scores below 700.